Aftershock filed bankruptcy. What now?

 

NOTE: I do not generally practice bankruptcy law, and, as stated elsewhere on this blog, the below does not constitute legal advice or create an attorney-client relationship. Consult with your attorney to address your specific legal needs.               

The news recently broke that Aftershock Comics filed for chapter 11 bankruptcy. Contrary to the opinion of many, this does not mean that Aftershock Comics will be immediately going out of business. Chapter 11 bankruptcy is primarily used by businesses to hold off creditors, reorganize their debt, and continue operating. That is the intent, anyways. If it is unsuccessful, then the company may end up selling off its assets to pay back creditors or otherwise be dissolved.

Unfortunately, the bankruptcy process can take some time to complete. Those who are owed, or likely to be owed, money (the creditors) should be receiving official documents regarding the bankruptcy and relevant deadlines. Once received, creditors should review them carefully.

In addition to being lengthy, the bankruptcy process can also be incredibly frustrating. There are going to be things that will seem unfair and anger many. For instance, now that Aftershock has filed for bankruptcy, they cannot assign property in exchange for waiving debt without the court’s permission, and creditors cannot knowingly harass the company for payment. Some people who have recently received payments may be asked to return them. There is also the possibility that some people may be required to continue working with the company even though they haven’t been paid. Finally, even though someone might be owed money, there is still a strong chance that they will (i) receive less than what they are owed or (ii) receive nothing at all.

There are likely to be a lot of twists and turns to this, and every creditor will have to decide how involved they want to be. Some questions to ask are:

1)      Do you want to just follow along with the process and see what happens?

2)      If eligible, do you want to be actively involved and try to influence and shape the reorganization process?

3)      How much time and money do you want to spend on this? Is it worth it versus what is owed?

While we wait for more information, if you think you are owed money, make sure you are listed as a creditor. If you are listed, then verify that the listed information is accurate. If you are not listed, then you will need to file a claim before the relevant deadlines. Now is also a good time to review your contract and gather all relevant information and evidence regarding any claims you may have against Aftershock.  Finally, it may make sense to consult with an attorney to evaluate your options.

The Basics of Option Agreements - Part 2

 Editor’s Note: This is part 2 on my series discussing option agreements. You can find part 1 here.

If you are approached about having a work optioned, the first thing you need to understand is if you have the rights to grant the option. Who else may have an interest in the rights to your work and will need to be consulted? Do you have to involve any of your co-creators? If you did not do all of the work yourself, or you did not acquire all of the rights for yourself, then you will need to involve them. Do you have an agent? Do they have the right to negotiate media deals on your behalf? If they do, you’ll need to get them involved. Also, do you still have the right to negotiate or grant the option? You will have to review your publishing agreement. Some publishers leave media rights with the creators. Some publishers merely want a cut of any option money you receive. Some want to negotiate it on your behalf and have the contractual right to do so. Worse yet, some have acquired the rights to negotiate and dispose of it without your involvement. You’ll need to see who else you need to involve and what rights you currently have.

When optioning a work, it is important to specify what is being included in the option. It is important to clarify if it just includes the main comic book or a specific series, or if it also includes any future works developed relating to the main comic book. Ideally, as a creator, you want to limit it as much as possible, as it gives you more opportunities to exploit the work and profit from it. However, most studios will want the right to incorporate or develop direct sequels into media adaptations. It is important to make sure it is addressed, and if needed, the compensation adjusted to account for the inclusion of additional works.

                The next key element of an option is what rights are being granted. For most production houses and studios, they want the right to almost everything. They will usually want film and TV rights, theatrical, radio, publishing, etc. Sometimes, however, a third party may only be interested in acquiring the rights for one thing, such as film or theatrical. Usually this is done because it is often cheaper to acquire limited rights, and the third party may not have the ability to exploit a full set of rights.

When granting rights in an option, anything you are able to reserve might be able to be licensed later on for additional money. These are called reserved rights. If possible, you should try and retain theatrical, radio/podcast, or games/video game rights. Another lucrative right is merchandising. Most studios will want the right to make and sell merchandise, and you will usually receive a separate royalty for these goods. Sometimes, you may be able to retain some limited merchandising rights to create goods based upon the original work (think goods based on a comic versus goods based on the movie).  This is something creators should push for, as it gives you an extra revenue stream. Every situation and studio is different.  With very few exceptions, creators should almost always retain publishing rights.

When dealing with the distribution and acquisition of rights, it is also common for studios to request that certain rights are frozen or subject to a right of first negotiation/refusal. If rights are frozen, then that means that one or both parties cannot exploit the rights, typically for a set amount of time, without the other party’s permission. If any reserved rights are subject to a right of first negotiation, rights of last refusal, or something similar, it means the party optioning the rights has the ability to negotiate for any rights it has not previously acquired. 

            Next time, I will discuss reversion and termination.

Comic Book Recommendations - 2022

             It’s the end of another year, and it’s time to recommend some of the comic books I read this year. As I mentioned in 2020 and 2021, I tend to focus on creator-owned titles, these will mostly be graphic novels/trade paperbacks, and they may not all have been released this year.

            As always, I’ve provided links where I can. Links to Amazon will be affiliate links. Anywhere else is not. Even so, if you’re intrigued by these books, try to buy them from your local comic shop or book store. 

Touching Evil, vol. 3, by Dan Dougherty

I’ve been a fan of this series for years, and I believe it to be one of the more unique ideas in horror comics in a while. A satisfying end to the series, but here’s to hoping for more in the future.

 You can buy it here.

Wasted Space,  vols. 4 & 5, by Michael Moreci and Hayden Sherman

This series wrapped up its run this year, and you should be able to find a collected edition. Moreci seemed to have a lot on his mind during the course of the series, and he used it to explore topics of politics, religion, creation, and destiny. Sherman’s gritty and dynamic artwork helped bring this world to life.

 

Maggie the Mechanic: A Love and Rockets Book, Jamie Hernandez

Remember when I said I am sometimes woefully behind on comics? This is a prime example. These books have been around for 40 years, and this is the first time I’ve read a Love and Rockets book. Great art, interesting and entertaining story. Even though comics have been diversifying for some time, there’s still not much on the stands that looks and reads like this.

 

The Many Deaths of Laila Starr, by Ram V and Filipe Andrade

This is a book that will stay with you. It’s a fascinating exploration of life and death and destiny, and the art from Andrade is perfect for the story being told.  

 

Money Shot , vol. 2, by Tim Seeley, Sarah Beattie, and Rebekah Issacs

Volumes one and two of this very-much NSFW comic are incredibly entertaining if you don’t mind your entertainment being more risqué. If that’s you, definitely consider checking out.

 

Previous volumes of the books below have appeared on other years’ lists, but I felt like they deserved a follow up.

 

Something is Killing the Children, vol. 4

This volume starts a new arc for the series, and it continues to be superb. This series was definitely one of my favorites of the past few years, and I look forward to wear it goes.

 

The Good Asian, vol. 2

There were only two volumes to this book, and both are fantastic noir. You’re missing out if you don’t read the whole story set in San Francisco’s Chinatown in the early 1900s.